By on January 4, 2013

The Canadian government will put up $250 million as part of an “auto innovation fund”, a continuation of a 2008 program which the government claims led to over $1 billion in spending.

Canadian Prime Minister Stephen Harper will make the announcement today at Ford’s Oakville plant – which happens to be looking for government money to help perform upgrades in anticipation of a new model being built at the plant.

The state of Canadian auto manufacturing seems to get bleaker as the days go on; Canada is said to be the most expensive place in the world to build a car, thanks in part to a strong Canadian dollar. The latest round of negotiations with the CAW did little to bring down labor costs, while CAW rank-and-file think the deal gave too many concessions to the auto makers. GM has consistently moved vehicle production out of their first-rate Oshawa assembly plant. In the last decade, only one plant, a Toyota facility, has been built in Canada – though others have been upgraded, no new real investment has been put in place.  Ultimately, the $250 million on offer from the government likely won’t go very far given the needs of the OEMs and their many suppliers. But it’s value as a symbolic gesture make it worth noting.

 

 

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28 Comments on “Canadian Government Launches $250 Million Auto “Innovation Fund”...”


  • avatar
    schmitt trigger

    It would be interesting to learn what is keeping the $CAD so high in value. Does Canada enjoy a substantial trade surplus?

    • 0 avatar
      -Cole-

      Consider instead what makes the American dollar so low.

    • 0 avatar
      mikey

      @schmitt trigger….To answer your question, one word…”oil”

    • 0 avatar
      CrapBox

      Just like Norway, Canada thrives on exporting oil, minerals and smug moral superiority to its neighbors.

      • 0 avatar
        mikey

        @CrapBox……Really? You feel better now?

      • 0 avatar
        jjster6

        “smug moral superiority”

        CrapBox – You made me laugh so hard I almost wet myself. And it is so true.

      • 0 avatar
        MeaCulpa

        Ziiiing!

      • 0 avatar
        Charliej

        Being from Alabama, I never had too much to do with Canadians until I retired and moved to Mexico. Down here, half the ex-pats are Canadian. I have got to know quite a few and they seem like quite nice people as a whole. At the very least, they seem to be better educated than the Americans. As far as “smug moral superiority”, I would say they have a reason to feel superior. Canada does not have a republican party that is trying to undo the last two elections because they can not deal with reality. Until Canada sinks to the level of the US, which may not happen, they can be smugly superior.

      • 0 avatar
        28-Cars-Later

        So you you prefer Obamanomics,
        comerade Charlie?

        I wouldn’t stop at the last few elections, I would undo things back to 1985 if I could.

      • 0 avatar
        mikey

        Wow! You got to love the internets. Where else can gutless wimps,hide behind a keyboards,and insult 40 million people,in two country’s.?

      • 0 avatar
        corntrollio

        You want to go back to a 50% top marginal federal income tax rate, 28-Cars-Later?

      • 0 avatar
        MeaCulpa

        @mikey

        I think you take it a bit to seriously, it’s all shits and giggles. Be happy that you have the Queen and the french, without them you’re just americans.

      • 0 avatar
        mikey

        @Mea… Yeah… You got that right.

      • 0 avatar
        MeaCulpa

        @mikey

        Just to make sure we’re on the same page; I was just paraphrasing the “queen” addressing Canada from the kids in the hall, me and my best friend still chuckle at the mere memory of the “I lost my drum” bit they did. Nowadays I have to make do with old Trailer Park Boys episodes. Canadians; great comedians, shitty singers.

      • 0 avatar
        CrapBox

        No insult intended. My opinion is based on the fact that some of my childhood friends worked for the CBC and then graduated to foreign media outlets such as PBS and Radio Netherlands. They achieved great success projecting smug moral superiority.

      • 0 avatar
        bufguy

        As a Buffalonian who travels to Toronto often, I wouldn’t say Canadians have a smug moral superiority, but they are proud of their country and they have something to be proud of. Toronto is a gorgeous bustling city that has more construction than any other city in North America. They have abundant natural resources, they embrace immigrants, their education system is superior to ours, their citizens don’t have to worry abot healthcare, their banking system is robust and well regulated, their crime rate is extremely low and they never experienced the recession we did.

      • 0 avatar
        28-Cars-Later

        @corntrollio

        Honestly if I could snap my fingers and do anything, I would end the Fed, give the currency back to Treasury, halve the size of the federal gov’t, impose a flat tax, bring back a laissez-faire style economy, withdraw from GATT (possibly NAFTA too), and initially place huge tariffs on Chinese (and possibly all Asian) made goods to force retailers to look elsewhere for cheap wares and allow time for North American made products to enter the market.

      • 0 avatar
        corntrollio

        Of course, all those things have little to do with 1985…

        The 80s had famous Fed activity, had a lot of intervention of government into the economy, increased the deficit, and specifically in 1985, had much much higher marginal tax rates (even if effective rates weren’t as bad).

        GATT came about in 1947, by the way. You’re almost 40 years too late.

    • 0 avatar
      danio3834

      What Cole said. It’s relative to the US dollar which has fallen substantially.

    • 0 avatar
      MeaCulpa

      laissez-faire economics and trade barriers? Yes that makes all the sense in the world, like christian science or competative sleeping…

  • avatar
    tresmonos

    Canada was resistent to the economic recession due to it’s well regulated monetary system. I will also go ahead and say that it’s immigration policy, lack of military spending and swath of natural resources help it’s economic situation tremendously. (this is my opinion – I am not even close to an economist)

    In spite of all of it’s political faults, I thoroughly enjoyed my time working in Toronto. I hope the auto industry doesn’t shed it’s Canadian skin. I have a unreasonable nostalgia for plants; it is really cool to walk into a historic facility to go help build cars.

  • avatar
    danio3834

    It would be nice if we didn’t need to bribe manufacturers to continue working here with short sighted lump sums. Instead, we should really be looking at ways to make manufacturing in Canada sustainable for the long run.

    A large part of that would be keeping the Government’s hands out of it in the first place. History shows that lump sum investments into manufacturing plants by Governments only stave off the inevitable for a short time, if at all. ie. Ford’s STAP.

  • avatar
    redmondjp

    This is nothing new. Back in 1996, Paccar closed the Ste. Therese assembly plant, which had been on strike for the preceeding eight months (Paccar does not suffer strikes).

    A year after the plant closed, Paccar announced that the plant would reopen in 1999, after the Canadian government kicked in a bucketload of $ for modernization. The plant did indeed reopen in the fall of 1999.

  • avatar
    tiredoldmechanic

    Crapbox,
    Please don’t judge us by the CBC, otherwise known as the Communist Broadcasting Collective. Smug moral superiority is certainly thier stock in trade but they do not define Canada, despite thier assertions to the contrary.

  • avatar
    Sooke

    We’re like Western Europe, we spend zilch on our military, assuming the US military will protect us from the bad guys.

    Otherwise we’d be Novo Siberia.

    • 0 avatar
      MeaCulpa

      Howe’s that working out for us really? To stay in the good graces of le Yanks we’re sending troops to their colonial wars and help them prop up semi-dictators, making us all ripe for suicide bombers. Give me a nice, big, well funded conscript army trained to fight a conventional enemy, and keep it home.

  • avatar
    Lightspeed

    If this “innovation” fund is like the one’s I’ve worked with they typically involve govt and industry matching funding on R&D projects with the aim of commercializing a technology. That’s where the govt can say it leveraged its investment. Historically, govt investment in advancing R&D has worked out pretty well, such as in the development of the internet and in aerospace. In the Canadian auto industry it will likely be targeted on efficiency and productivity with the aim to make Canadian plants more competitive. The spin-off benefits would include knowledge, products and services with applications in other industries.
    There, I got through this without saying something nasty about Americans or Canadians or anybody else.

  • avatar

    Canada does not have car companies and market is small – why someone thought it is good idea to build cars in Canada. And considering strong Canadian dollar and militant unions it is losing proposition. Just matter of time. The only advantage I can see – companies do not have to pay pensions and for health care if Canada is truly socialist country (and not quasi-socialist as US) and Government provides pension and free healthcare. Government forcing companies to pay health insurance and high corp taxes is a big disadvantage US has as a country. But US dollar is weak (thank you Obama! No pun intended it is actually is a good for economy, though those on fixed income and savers to be damned!) and market is largest and most lucrative in the world.


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